Construction material prices rose 0.3% in October and are down 0.2% on a year-over-year basis, according to Associated Builders and Contractors. Prices in October were 38.8% higher than in February 2020.
Nonresidential construction material prices rose 0.3% from September to October and decreased 0.5% compared with one year ago. Softwood lumber prices are up 2.7% year over year and up 1.6% from September to October. Iron and steel prices are down 6.9% year over year and up 1.2% for the month. Natural gas rose 29.3% from September to October and fell 1.3% year over year. Crude petroleum rose 7.3% for the month and is down 17.3% year over year.
“Higher energy prices drove the increase in construction input prices observed in October,” said ABC Chief Economist Anirban Basu. “While prices for a few other materials, like concrete and copper products, also rose for the month, overall input prices are lower than they were one year ago and have fallen 5% since reaching an all-time high in June 2022.
“Heading into 2025, it’s unclear if prices will remain so well-behaved,” Basu continued. “The next administration’s trade policy increases uncertainty regarding construction materials costs. Beyond the implications of potential tariffs, input prices may rise in the short term if purchasers rush to import materials prior to the implementation of those policies. As of October, contractors expected their profit margins to expand through the first quarter of 2025, according to ABC’s Construction Confidence Index. That portion of the index will bear close watching as trade policy shifts in the coming months.”
